In conventional systems for provisioning and procurement of products and services, a company employee acts as a consumer or buyer to purchase directly from a supplier or through a reseller of the supplier. The company negotiates an agreement with the supplier or reseller and institutes the policy for each purchase. In one example, in order to procure a product from a reseller, a company employee completes a purchase order and provides the purchase order to one or more other entities at the company for approval. Upon approval, the purchase order is delivered to the reseller. The reseller processes the purchase order, provides the goods or services, and sends an invoice to the company. Once the invoice has been received and reviewed, the company pays the reseller.
The conventional systems suffer from a variety of drawbacks. For example, the approval process can be very time consuming. The employee may need to investigate the status of the approval, which can require sending faxes, placing phone calls, sending e-mails, or a combination of these efforts. Also, it may be difficult to track down a particular approving entity in a large organization to request approval or obtain a status. Finally, the approver might also have the same problems when attempting to find the formal request due to inefficiencies in the paper trail.
Another drawback to the conventional systems is that the process can be confusing and time-consuming, even if the procurement is for products or services that are commonly ordered at the same time or periodically. For example, when a new employee is hired, the company procures a collection of products or services for that new employee. For each new employee, however, the company must submit the purchase orders and proceed with tracking the requests for approval. Though the frequency of similar orders is high, absence of a checklist or validated procedure tend to unnecessarily increase input error rates.
When procuring products or services, some products or services are available from outside vendors, whereas others may already be available, e.g., from a storage facility or inventory of the company. Nevertheless, the company employee completes a purchase order form for each desired product or service, and the company must ascertain which of those products or services may be available internally.
Some purchase order forms can cause a delay in procurement. If the form is completed incorrectly, the process must start over. Because the purchase orders are not always user-friendly, the company employee may be required to resubmit the purchase order numerous times until it is properly completed.
In one attempt to streamline the purchasing process, some companies use a “punchout” procedure. When a company employee wants to purchase a product from a vendor, the employee clicks on a hyperlink at the company's intranet website. The hyperlink directs the employee to a micro-site of the vendor's website that is configured for employees. Each “punchout” directs the employee to a single vendor, which can add to the time consuming process of purchasing multiple products or services from multiple vendors. Additionally, the use of punchouts does not allow a user to compare prices or integrate the system into internal overhead costs.